Walpole was born in Houghton, Norfolk, in 1676. One of 19 children, he was the third son and fifth child of Robert Walpole, a member of the local gentry and a Whig Politician who represented the borough of Castle Rising in the House of Commons, and his wife Mary Walpole, the daughter and heiress of Sir Geoffrey Burwell of Rougham, Suffolk. Horatio Walpole, 1st Baron Walpole was his younger brother.

As a child, Walpole attended a private school at Massingham, Norfolk. Walpole entered Eton College in 1690 where he was considered "an excellent scholar". He left Eton on 2 April 1696 and matriculated at King's College, Cambridge on the same day. On 25 May 1698 he left Cambridge after the death of his only remaining elder brother, Edward, so that he could help his father administer the family estate to which he had become the heir. Walpole had planned to become a clergyman but as he was now the eldest surviving son in the family, he abandoned the idea. In November 1700 his father died, and Robert succeeded to inherit the Walpole estate. A paper in his father's handwriting, dated 9 June 1700, shows the family estate in Norfolk and Suffolk to have been nine manors in Norfolk and one in Suffolk.

On 30 July 1700, Walpole married Catherine, daughter of John Shorter of Bybrook in Ashford, Kent. She was described as "a woman of exquisite beauty and accomplished manners". Her £20,000 dowry was, according to her brother-in-law Horatio Walpole, spent on the wedding, christenings and jewels. Together they had two daughters and three sons:

Walpole's political career began in January 1701 when he won a seat in the general election at Castle Rising. He left Castle Rising in 1702 so that he could represent the neighbouring borough of King's Lynn, a pocket borough that would re-elect him for the remainder of his political career. Voters and politicians nicknamed him "Robin."

Like his father, Robert Walpole was a member of the Whig Party. In 1705, Walpole was appointed by Queen Anne to be a member of the council for her husband, Prince George of Denmark, Lord High Admiral. After having been singled out in a struggle between the Whigs and the government, Walpole became the intermediary for reconciling the government to the Whig Leaders. His abilities were recognised by Lord Godolphin (the Lord High Treasurer and leader of the Cabinet) and he was subsequently appointed to the position of Secretary at War in 1708; for a short period of time in 1710 he also simultaneously held the post of Treasurer of the Navy.

Despite his personal clout, however, Walpole could not stop Lord Godolphin and the Whigs from pressing for the prosecution of Henry Sacheverell, a minister who preached anti-Whig sermons. The trial was extremely unpopular with much of the country, causing the Sacheverell riots, and was followed by the downfall of the Duke of Marlborough and the Whig Party in the general election of 1710. The new ministry, under the leadership of the Tory Robert Harley, removed Walpole from his office of Secretary at War but he remained Treasurer of the Navy until 2 January 1711. Harley had first attempted to entice him and then threatened him to join the Tories, but Walpole rejected the offers, instead becoming one of the most outspoken members of the Whig Opposition. He effectively defended Lord Godolphin against Tory attacks in parliamentary debate, as well as in the press.

In 1712, Walpole was accused of venality and corruption in the matter of two forage contracts for Scotland. Although it was proven that he had retained none of the money, Walpole was pronounced "guilty of a high breach of trust and notorious corruption". He was impeached by the House of Commons and found guilty by the House of Lords; he was then imprisoned in the Tower of London for six months and expelled from Parliament. While in the Tower he was regarded as a political martyr, and visited by all the Whig Leaders. After he was released, Walpole wrote and published anonymous pamphlets attacking the Harley ministry and assisted Sir Richard Steele in crafting political pamphlets. Walpole was re-elected for King's Lynn in 1713.

Queen Anne died in 1714. Under the Act of Settlement 1701, which excluded Roman Catholics from the line of succession, Anne was succeeded by her second cousin, the Elector of Hanover, George I. George I distrusted the Tories, whom he believed opposed his right to succeed to the Throne. The year of George's accession, 1714, marked the ascendancy of the Whigs who would remain in power for the next fifty years. Robert Walpole became a Privy Councillor and rose to the position of Paymaster of the Forces in a Cabinet nominally led by Lord Halifax, but actually dominated by Lord Townshend (Walpole's brother-in-law) and James Stanhope. Walpole was also appointed chairman of a secret committee formed to investigate the actions of the previous Tory ministry in 1715. Lord Oxford was impeached, and Lord Bolingbroke suffered from an act of attainder.

Walpole's first year as Prime Minister was also marked by the discovery of a plot formed by Francis Atterbury, the Bishop of Rochester. The exposure of the scheme crushed the hopes of the Jacobites whose previous attempts at rebellion (most notably the risings of 1715 and 1719) had also failed. The Tory Party was equally unfortunate even though Lord Bolingbroke, a Tory leader who fled to France to avoid punishment for his Jacobite sympathies, was permitted to return to Britain in 1723.

Walpole continued to be an influential figure in the House of Commons. He was especially active in opposing one of the Government's more significant proposals, the Peerage Bill, which would have limited the power of the monarch to create new peerages. Walpole brought about a temporary abandonment of the bill in 1719 and the outright rejection of the bill by the House of Commons. This defeat led Lord Stanhope and Lord Sunderland to reconcile with their opponents; Walpole returned as Paymaster of the Forces and Townshend was appointed Lord President of the Council. By accepting the position of Paymaster, however, Walpole lost the favour of the Prince of Wales (the Future King George II) who still harboured disdain for his father's Government.

Along with his political interests in his last years, Walpole enjoyed the pleasures of the hunt. Back at his recently rebuilt country seat in Houghton, Norfolk, such pastimes were denied him due to "dismal weather". He also enjoyed the beauties of the countryside. His art collection gave him particular pleasure. He had spent much money in the 1720s and 1730s in building up a collection of Old Masters from all over Europe. Walpole also concerned himself with estate matters.

The resignation of Sunderland and the death of Stanhope in 1721 left Walpole as the most important figure in the administration. In April 1721 he was appointed First Lord of the Treasury, Chancellor of the Exchequer and Leader of the House of Commons. Walpole's de facto tenure as "Prime Minister" is often dated to his appointment as First Lord of the Treasury in 1721. His brother-in-law Lord Townshend, served as Secretary of State for the Northern Department and controlled the nation's foreign affairs. The two also had to contend with the Secretary of State for the Southern Department, Lord Carteret. Townshend and Walpole were thus restored to power and "annihilated the opposing faction".

In the United States, the towns of Walpole, Massachusetts (founded in 1724), and Orford, New Hampshire (incorporated in 1761), take their respective names from Sir Robert Walpole, Earl of Orford.

Townshend, working with the king, helped keep Great Britain at peace, especially by negotiating a treaty with France and Prussia in 1725. Walpole was not consulted and stated that Townshend was "too precipitate" in his actions. Great Britain, free from Jacobite threats, from war, and from financial crises, grew prosperous, and Robert Walpole acquired the favour of George I. In 1725 he persuaded the king to revive the Knight of the Bath, and in 1726 a Knight of the Garter, earning him the nickname "Sir Bluestring". He was one of the Founder Knights of the Order of the Bath, and was the 545th Knight of the Garter. Moreover, his eldest son was granted a barony.

Walpole's failure to maintain a policy of avoiding military conflict eventually led to his fall from power. Under the Treaty of Seville (1729), Great Britain agreed not to trade with the Spanish colonies in North America. Spain claimed the right to board and search British vessels to ensure compliance with this provision. Disputes, however, broke out over trade with the West Indies. Walpole attempted to prevent war but was opposed by the King, the House of Commons, and by a faction in his own Cabinet. In 1739 Walpole abandoned all efforts to stop the conflict and commenced the War of Jenkins' Ear (so called because Robert Jenkins, a Welsh mariner, claimed that a Spaniard inspecting his vessel had severed his ear).

Walpole's position was threatened in 1727 when George I died and was succeeded by George II. For a few days it seemed that Walpole would be dismissed but, on the advice of Queen Caroline, the King agreed to keep him in office. Although the King disliked Townshend, he retained him as well. Over the next years Walpole continued to share power with Townshend but the two clashed over British foreign affairs, especially over policy regarding Austria. Gradually Walpole became the clearly dominant partner in government. His colleague retired on 15 May 1730 and this date is sometimes given as the beginning of Walpole's unofficial tenure as Prime Minister. Townshend's departure enabled Walpole to conclude the Treaty of Vienna, creating the Anglo-Austrian alliance.

Walpole secured the support of the people and of the House of Commons with a policy of avoiding war. He used his influence to prevent George II from entering the War of the Polish Succession in 1733, because it was a dispute between the Bourbons and the Habsburgs. He boasted, "There are 50,000 men slain in Europe this year, and not one Englishman." By avoiding wars, Walpole could lower taxes. He reduced the national debt with a sinking fund, and by negotiating lower interest rates. He reduced the land tax from four shillings in 1721, to 3s in 1728, 2s in 1731 and finally to only 1s in 1732. His long-term goal, was to replace the land tax, which was paid by the local gentry, with excise and customs taxes, which were paid by merchants and ultimately by consumers. Walpole joked that the landed gentry resembled hogs, which squealed loudly whenever anyone laid hands on him. By contrast, he said, merchants were like sheep, and yielded their wool without complaint. The joke backfired in 1733 when he was defeated in a major battle to impose excise taxes on wine and tobacco. To reduce the threat of smuggling, the tax was to be collected not at ports but at warehouses. This new proposal, however, was extremely unpopular and aroused the opposition of the nation's merchants. Walpole agreed to withdraw the bill before Parliament voted on it, but he dismissed the politicians who had dared to oppose it in the first place. Thus, Walpole lost a considerable element of his Whig Party to the Opposition.

After the general elections of 1734, Walpole's supporters still formed a majority in the House of Commons although they were less numerous than before. He maintained both his parliamentary supremacy and his popularity in Norfolk, his home county. In May 1734, he presented a new silver mace "weighing 168 ounces, gilt and finely exchased, to the city of Norwich – on the cup part of it are Sir Robert's arms, and the arms of the city; it was first carried before Mayor Philip Meadows Esq. on the 29th of May". However, despite these great occasions, Walpole's broader popularity had begun to wane. In 1736 an increase in the tax on gin inspired riots in London. The even more serious Porteous Riots broke out in Edinburgh after the King pardoned a captain of the guard (John Porteous) who had commanded his troops to shoot a group of protesters. Though these events diminished Walpole's popularity, they failed to shake his majority in Parliament. Walpole's domination over the House of Commons was highlighted by the ease with which he secured the rejection of Sir John Barnard's plan to reduce the interest on the national debt. Walpole was also able to persuade Parliament to pass the Licensing Act of 1737 under which London theatres were regulated. The Act revealed a disdain for Swift, Pope, Fielding, and other literary figures who had attacked his government in their works.

10 Downing Street represents another part of Walpole's legacy. George II offered this home to Walpole as a personal gift in 1732, but Walpole accepted it only as the official residence of the First Lord of the Treasury, taking up his residence there on 22 September 1735. His immediate successors did not always reside in Number 10 (preferring their larger private residences) but the home has nevertheless become established as the official residence of the Prime Minister (in his or her capacity as First Lord of the Treasury).

Walpole's first wife Catherine died on 20 August 1737 and was buried in Henry VII Chapel, Westminster Abbey.

Prior to the death of his first wife, Walpole took on a mistress, Maria, daughter of Thomas Skerrett (died 1734; an Irish merchant living in Dover Street, London). She was a fashionable socialite of wit and beauty, with an independent fortune of £30,000. Walpole had married her by March 1738. They had been living openly together in Richmond Park and Houghton Hall before 1728. Maria had borne him a daughter, also called Maria, who was no longer illegitimate after her parents' marriage and, as the daughter of an Earl, became Lady Maria Walpole. In 1746, this daughter married Colonel Charles Churchill of Chalfont (1720–1812), illegitimate son of General Charles Churchill and became the housekeeper of Windsor Castle. Their daughter Mary became the second wife of Charles Cadogan, 1st Earl Cadogan, and had issue. The second Lady Orford died following a miscarriage on 4 June 1739. Walpole considered her "indispensable to his happiness", and her loss plunged him into a "deplorable and comfortless condition", which ended in a severe illness.

Walpole's influence continued to dramatically decline even after the war began. In the 1741 general election his supporters secured an increase in votes in constituencies that were decided by mass electorates but failed to win in many pocket boroughs (constituencies subject to the informal but strong influence of patrons). In general the government made gains in England and Wales but this was not enough to overturn the reverses of the 1734 election and further losses in Cornwall where many constituencies were obedient to the will of the Prince of Wales (who was also Duke of Cornwall). These constituencies returned members of parliament hostile to the Prime Minister. Similarly, the influence of the Duke of Argyll secured the election of members opposed to Walpole in some parts of Scotland. Walpole's new majority was difficult to determine because of the uncertain loyalties of many new members, but contemporaries and historians estimated it as low as fourteen to eighteen.

In the new Parliament, many Whigs thought the aging Prime Minister incapable of leading the military campaign. Moreover, his majority was not as strong as it had formerly been, his detractors—such as william Pulteney, earl of Bath, and Lord Perceval—being approximately as numerous as his supporters. Behind these political enemies were opposition Whigs, Tories and Jacobites. Walpole was alleged to have presided over an immense increase in corruption and to have enriched himself enormously whilst in office. Parliamentary committees were formed to investigate these charges. In 1742 when the House of Commons was prepared to determine the validity of a by-election in Chippenham, Walpole and others agreed to treat the issue as a motion of no confidence. As Walpole was defeated on the vote, he agreed to resign from the Government. The news of the naval disaster against Spain in the Battle of Cartagena de Indias also prompted the end of his political career. King George II wept on his resignation and begged to see him frequently. As part of his resignation the King agreed to elevate him to the House of Lords as the Earl of Orford, Viscount Walpole and Baron Walpole of Houghton in the County of Norfolk, this occurred on 6 February 1742. Five days later he formally relinquished the seals of office.

His health, never good, deteriorated rapidly toward the end of 1744; Orford died in London in 1745, aged nearly sixty-nine years; he was buried in the parish church of St Martin in Houghton, Norfolk. His earldom passed to his eldest son Robert who was in turn succeeded by his only son George. Upon the death of the third Earl, the Earldom was inherited by the first Earl's younger son Horace Walpole, who is now remembered for his many thousands of insightful letters, published in 48 volumes by Yale University Press.

Walpole's strategy of keeping Great Britain at peace contributed greatly to the country's prosperity. Walpole also managed to secure the position of the Hanoverian Dynasty, and effectively countervailed Jacobitism. The Jacobite threat ended, soon after Walpole's term ended, with the defeat of the rebellion of 1745. Later in the century, the Whig MP Edmund Burke "admitted him into the whig pantheon". Burke wrote:

Walpole also left behind a collection of art which he had assembled during his career. His grandson, the 3rd Earl of Orford, sold many of the works in this collection to the Russian Empress Catherine II in 1779. This collection—then regarded as one of the finest in Europe—now lies in the State Hermitage Museum in Saint Petersburg, Russia. In 2013 the Hermitage loaned the collection to Houghton for display following the original william Kent hanging plan, recently discovered at Houghton.

In his new political positions, and encouraged by his advisers, Walpole introduced the sinking fund, a device to reduce the national debt. The Cabinet of which he was a member was often divided over most important issues. Normally, Walpole and Lord Townshend were on one side, with Stanhope and Lord Sunderland on the other. Foreign policy was the primary issue of contention; George I was thought to be conducting foreign affairs with the interests of his German territories, rather than those of Great Britain, at heart. The Stanhope–Sunderland faction, however, had the King's support. In 1716 Townshend had been removed from the important post of Northern Secretary and put in the lesser office of Lord Lieutenant of Ireland. Even this change did not appease Stanhope and Sunderland who secured the dismissal of Townshend from the Lord-Lieutenancy in April 1717. On the next day, Walpole resigned from the Cabinet to join the Opposition "because I could not connive at some things that were carrying on", and by joining the opposition he did not intend "to make the king uneasy or to embarrass his affairs." In the new Cabinet, Sunderland and Stanhope (who was created an Earl) were the effective heads.

While the "country party" attacked Walpole relentlessly, he subsidised Writers and lesser-known journalists such as william Arnall and Bishop Benjamin Hoadly as well as two men he named to the role of poet laureate, Laurence Eusden and Colley Cibber. They defended Walpole from the charge of evil political corruption by arguing that corruption is the universal human condition. Furthermore, they argued, political divisiveness was also universal and inevitable because of selfish passions that were integral to human nature. Arnall argued that government must be strong enough to control conflict, and in that regard Walpole was quite successful. This style of "court" political rhetoric continued through the 18th century.